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Foreign secretary Dominic Raab said the UK government would back the probe, announced by the territory’s governor, into “deeply troubling” claims including political interfence, intimidation, and serious organised crime.
Governor Gus Jaspert made the announcement on Monday after reportedly returning to the Carribean islands, which are a British overseas territory, following a period of leave in the UK.
Mr Raab said he had agreed to the inquiry after serious concerns were raised with MrJaspert.
They included claims of “political interference and coercion” in relation to public appointments, the criminal justice system and individual criminal cases.
In a written Commons statement, Mr Raab said it had been alleged that public servants, community leaders and people in the media had been intimidated to such a degree they spoke of living in a “climate of fear”.
It was claimed funds set aside for struggling families during the pandemic had been “reallocated to political allies” while government contracts had been awarded without any proper procurement process.
There were also concerns over the misuse of taxpayers’ money on infrastructure projects and about the “potential vulnerability” of the islands to serious organised crime.
Those worries were underlined last November with the seizure of more than two tones of cocaine worth almost £190 million.
“The UK is extremely concerned about the state of good governance in the British Virgin Islands,” Mr Raab said.
“A consistent and deeply troubling array of concerns have been put to the governor by local institutions and the community.
“The UK government is responsible for ensuring the security and good governance of BVI.
“We have a constitutional and moral duty to protect the interests of the people of BVI. We cannot ignore such serious allegations.
“The commission will inquire into whether there is information to substantiate claims that corruption, abuse of position and serious impropriety has taken place in public office in recent years, and it will make recommendations.”
Mr Raab said that the commission inquiry would be led by Sir Gary Hickinbottom, who will have powers of a high court judge when it comes to gathering evidence in the territory.
He said he expected Sir Gary to deliver his report to the governor within six months.
Additional reporting by Press Association
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